The Court of Appeal has rejected a test case challenging a decision to allow a mobile phone mast near three schools.
Harrogate council had rejected the mast application
In June three mobile phone companies won the right to erect a 25-metre mast in Harrogate, North Yorkshire.
Giving judgement on Friday, Lord Justice Laws said the planning process would only consider "perceived health concerns" in exceptional circumstances.
Liberal Democrat MP Phil Willis said the ruling was a "body blow to parents across the country".
Health risks from masts have not been proven, but the National Radiological Protection Board advises a "precautionary approach" to siting masts near schools.
But the judge ruled: "It remains central government's responsibility to decide what measures are necessary to protect public health."
The proposed mast is to be built within 400 metres of St Robert's RC Primary, Woodfields Primary and Granby High School.
Parents said that would put the schools within the electromagnetic field of the mast, which would be used by T-Mobile, Orange and Hutchison 3G.
Planning permission had been refused by Harrogate Council and the companies took the case to the High Court, where a judge ruled the planned mast met safety guidelines, prompting this week's hearing at the Court of Appeal.
But the judges said the planning decision was not the place for determining health safeguards.
Mr Willis, the Harrogate and Knaresborough MP who is chairman of the Commons all-party group on mobile communications, said the Appeal Court judges had "swept aside" the recommendations of the Stewart Report on mobile phone safety which called for changes to planning arrangements to improve local consultation.
He said their decision had given mobile phone operators "freedom to site masts on or near school playing fields throughout the United Kingdom".
"The decision of the appeal court ... is a body blow to concerned parents throughout the country.
"This judgement is so fundamental, I have today written to the Secretary of State John Prescott to urge him to take this case to the House of Lords," said Mr Willis.
After the hearing, one of the Harrogate protesters, Peter Brooks, said: "I am surprised a personal risk to health was not discussed in court because that was what we had discussed and read about beforehand."
He added that further legal action was being considered.
On Thursday, the Appeal Court judges reserved judgement on the case of a proposed mast near homes in Winchester.
This week, an investigation by BBC Three found that one in 10 schools has a phone mast within a 50 to 200 metre radius.